MSE strikes the ‘gong’ in new avatar

NARAYANAN V Chennai | Updated on January 03, 2020 Published on January 03, 2020

Mobile app DailyGong offers a gamut of financial products

“To improve is to change; to be perfect is to have changed often,” goes the old saying that holds true for the Madras Stock Exchange (MSE) — India’s fourth oldest bourse, and South India’s first.

Started in 1937, MSE played a crucial role in capital formation and industrialisation in the South, besides serving as a primary exchange to companies such as Ashok Leyland, Madras Cements, Tube Investments and MRF.

A shift from the earlier outcry system to online trading, thanks to the advent of technology, and the consequent emergence of the National Stock Exchange (NSE) as a primary stock market platform sounded the death knell for regional stock exchanges, and MSE was no exception.

Many regional exchanges realised the obsolescence of their existing business models and embraced broking and depository businesses to stay relevant. In 2001, MSE followed suit, launching a subsidiary, MSE Financial Services Ltd (MSEFSL).

“MSE over the years had built a reputation for good corporate governance of companies listed in the exchange, superior regulatory compliance and for pioneering the concept of T+2 settlement,” said V Nagappan, Chief Mentor at MSEFSL, who was associated with MSE for several decades.

Consequent to an exit policy issued by SEBI, MSE exited the stock exchange business in 2015.

Leveraging tech

While other regional stock exchanges went into oblivion, MSE, via MSEFSL, decided to reinvent itself by investing in technology. Last year, it launched ‘DailyGong’, a mobile app that offers a range of trading transactions in equity, derivatives and currency market with a few clicks.

“We have been catering to old investors who have been with us for 20-25 years. The only way to cater to gen-next is to invest in technology. So we introduced DailyGong,” Nagappan said.

The company was able to generate a few thousand clients within a few months of its launch. Bolstered by the initial success, MSEFSL is now planning to widen its membership base. “Today 98 per cent of people don’t invest in the stock market. Even if 2 per cent is converted to invest in equity there is a big opportunity in Tamil Nadu and the entire South. We want to capture that,” Nagappan added.

Other plans

Plans are also afoot to bring mutual funds, fixed deposits and a whole gamut of financial products under DailyGong in the near future.

While digital transformation rendered it irrelevant earlier, MSE in its new avatar has leveraged the same technology to serve investors. If it gets its act right, it may even regain its lost glory.

Published on January 03, 2020

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